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Interesting Medical Literature

Below is a list of interesting medical studies and other literature relating to the U.S. healthcare system (some of which is discussed elsewhere in this website), along with a brief summary of each. This list is ordered by date of publication, with the most recent articles set out first. At times, the website hosting an article may move the webpage on which the article is found, resulting in a “broken” link. If that happens, usually you can find the article by performing a Google search on the citation. We try to verify the below links once or twice a year, and we’re always appreciative if you inform us of any broken links that you may encounter.

This is a compilation of the literature relating to various aspects of the U.S. healthcare industry, including the frequency of medical errors, the increase in health care costs caused by medical errors combined with the perverse financial incentives built into the for-profit fee structure of the U.S. healthcare system, and the current state of the U.S. medical malpractice system. It includes numerous medical studies, government investigations, scholarly books and articles, interviews with various stakeholders in the system, and other reports and investigations. Among the key findings are:

Medical errors occur in alarming numbers and are extremely costly.

Most medical errors go unreported.

Very few patients who are the victims of medical error actually sue.

The medical malpractice system improves patient safety by building in financial incentives for doctors and hospitals to be more careful.

Patient safety is suffering because so few patients sue.

The experts agree that of those lawsuits filed, the vast majority are not frivolous.

For those claims that are actually filed, the medical malpractice system works well – plaintiffs’ attorneys, paid on a contingent fee, cannot afford to risk spending tens to hundreds of thousands of dollars on pursuing weak cases and so generally filter those weak cases out, and the remaining strong cases generally settle for reasonable amounts.

Overall, the number and size of medical malpractice claims, lawsuits, and inflation-adjusted payouts are low and dropping.

A small number of doctors are responsible for most malpractice payouts, but even the most incompetent physicians are rarely held accountable by state medical boards or the federal government.

So-called “tort reform” laws harm patient safety, because they remove the financial incentive for doctors and hospitals to practice more safely.

So-called “tort reform” laws do not notably decrease health care costs but do result in an increase in medical errors.

Much of “defensive medicine” can be explained by the doctors’ and hospitals’ desire to earn more revenue.

However, “caps” on damages and other aspects of “tort reform” laws do keep many victims of medical errors from suing and do prevent those who sue from having anywhere near a full recovery for their injuries.

Strong insurance regulatory laws are the only way to control insurance rates for doctors and hospitals.

So-called “tort reform” has no effect on physician supply; instead, physician lifestyle, family, and age considerations are the most important factor for determining not only the doctor’s choice of location, but also his or her choice of specialty.

This is a compilation of statistics relating to the U.S. healthcare industry. In 2013, U.S. healthcare expenditures were $2.9 trillion, and they are projected to reach $3.4 trillion in 2016. The breakdown is: hospital care ($929 billion); physician and clinical services ($589 billion); dental services ($116 billion); prescription drugs ($262 billion); and nursing home and home health care ($239 billion).U.S. healthcare spending was about 18% of the Gross Domestic Product (“GDP”) in 2013 and is projected to grow steadily. Healthcare spending in America accounts for a larger share of GDP than in any other country, about twice the average for all other developed industrialized nations. The nations closest to the U.S. were the Netherlands (11.9%) and France (11.6%). Despite the “incredible” amounts that the U.S. spends on healthcare, 15.4% of people in the U.S. (48 million) lacked health care coverage for the entire year of 2012. The cost of healthcare in the U.S. is growing at a rate far exceeding the rate of inflation.

This report finds that as of 2009, the average (mean) compensation of CEOs at US nonprofit hospitals was about $600,000 in 2009. The CEOs were compensated at these levels regardless of the quality of care given in their hospitals (as measured by process quality performance, mortality rates, and readmission rates) or community benefit.

This article discusses the new research showing that as many as 440,000 patients die each year from medical mistakes in U.S. hospitals (not including outpatient doctors’ offices and clinics). This is more than four times the 98,000 previously estimated by the U.S. Institute of Medicine in its To Err Is Human report published in 1998. According to the article, a spokesman for the American Hospital Association (“AHA”) stated that the AHA is “sticking with” the previous estimate of 98,000 deaths per year from medical errors in hospitals. However, according to ProPublica, it asked three prominent patient safety researchers to review the new study, and all said that the methods and findings of the new study were credible. (Id.) One of those prominent patient safety researchers is Dr. Lucian Leape, a Harvard pediatrician who is referred to the “father of patient safety” and who was on the IOM committee that wrote the To Err Is Human report. Dr. Leape said that members of the IOM knew at the time that their estimate of medical errors was low, and he said that the new study’s methods and findings are credible. (Id.) Another of the patient safety researchers is Dr. David Classen, who is one of the leading developers of the Global Trigger Tool. Dr. Classen said that the Journal of Public Safety study was a sound use of the tool and a “great contribution.” He said that it is important to update the numbers from the IOM’s To Err Is Human report. (Id.) The third patient safety researcher is Dr. Marty Makary, a surgeon at Johns Hopkins Hospital whose book Unaccountable calls for greater transparency in health care. Dr. Makary said that the new estimate of deaths caused by medical error shows that eliminating medical errors must become a national priority. (Id.) Drs. Leape, Classen, and Makary all said that it is time to stop citing the 98,000 number. (Id.) Dr. David Mayer, the vice president of quality and safety at Maryland-based MedStar Health, said that people can make arguments about how many patient deaths are hastened by poor hospital care, but that’s not really the point. All the estimates, even on the low end, expose a crisis: “Way too many people are being harmed by unintentional medical error, and it needs to be corrected.” (Id.)

This is another article discussing the new research showing that as many as 440,000 patients die each year from medical mistakes in U.S. hospitals (not including outpatient doctors’ offices and clinics). This is four times the number of people dying from medical errors as had been previously thought. Improvements in research techniques have led to the better, updated numbers. This means that “hospitals are killing off the equivalent of the entire population of Atlanta one year, Miami the next, then moving to Oakland, and on and on.” These patients are not dying from the underlying illnesses that they have. Rather, they are dying from medical mistakes in the hospital that could have been prevented:

What do these errors look like? The sponge left inside the surgical patient, prompting weeks of mysterious, agonizing abdominal pain before the infection overcomes bodily functions. The medication injected into a baby’s IV at a dose calculated for a 200 pound man. The excruciating infection from contaminated equipment used at the bedside. Sadly, over a thousand people a day are dying from these kinds of mistakes.

(Id.)

And, it is the public who pays for these medical mistakes. “Hospitals shift the extra costs of errors onto the patient, the taxpayer and/or the business that buys health benefits for the [affected] patient.” (Id.)

The reason many hospital leaders fail to put a priority on safety is that we as a country haven’t forced them to do so. On the contrary, we haplessly pay them for these errors. We tolerate hospital lobbyists insisting on hiding their error rates. We fail to insist on safety when we choose where to seek care or when we put together our business’ health benefits. When we don’t demand safety, they don’t supply it.

This 2013 Journal of Patient Safety article shows that just in hospitals alone, the number of deaths due to preventable medical error is approximately 440,000 per year. (Id. at 127.) And, the number of cases of serious harm (but not death) to patients due to medical mismanagement in hospitals is ten-to-twenty times the number of deaths (or approximately 8.8 million to 17.2 million per year. (Id. at 122.) By way of comment, we note that this Journal of Patient Safety study does not evaluate non-hospital medical care (that is, outpatient care at doctors’ offices and medical clinics), and so the true toll from medical errors undoubtedly is much higher once you add in deaths due to medical errors in the non-hospital (outpatient) setting, as is discussed elsewhere in this website.

Public Citizen investigated whether medical malpractice payments were a significant driver of the increases in healthcare costs and whether restrictions on medical malpractice lawsuits would bring the cost of healthcare down. It found that malpractice litigation is not a significant driver of healthcare costs and that restrictions on medical malpractice lawsuits in fact have not brought down the cost of healthcare. Since 2003, medical malpractice payments have fallen by 28.8%, but the cost of healthcare has increased 58.3% during that same time period. Thus, medical malpractice lawsuits clearly are not what is causing healthcare costs to rise.

The U.S. pays roughly twice as much for its doctors as people in other wealthy countries (and we note that this is after adjusting for how rich each country is):

The reason is that physicians in the United States use their political power to limit the supply of doctors both by restricted med school enrollments and excluding foreign trained physicians…. As a result of this protectionism almost one-third of doctors are in the richest one percent of the income distribution and the overwhelming majority are in the top 3 percent.

From 1998-2013, doctors, hospitals, their trade associations, and insurance companies spent $7.7 billion on lobbying efforts. (Remember that each one billion is 1,000 times bigger than one million. So, they spent 7,700 million dollars.) In just 2013 alone, doctors, hospitals, their trade associations, and insurance companies spent $623 million. (Id.) For comparison, in 2013, lawyers and law firms spent just 2% of that amount (about $14 million), and of that, one-third represented lobbying efforts of big business law firms (presumably on behalf of their big business clients). (See Annual Lobbying on Lawyers and Law Firms – 2013. OpenSecrets.org website (last known to be available at <http://www.opensecrets.org/lobby/indusclient.php?id=K01>).)

This article shows that in 2013 (and based on a survey conducted by Integrated Healthcare Strategies and co-sponsored by the American Society for Healthcare Human Resources Administration), healthcare CEOs were paid the following:

Independent health system CEO
Average (mean) total cash compensation: $944,300

Subsidiary health system CEO
Average (mean) total cash compensation: $690,100

This report investigates the true cost of “defensive medicine.” It finds that despite claims that defensive medicine makes up 26% of healthcare spending, the true cost of defensive medicine amounts to a miniscule 1-2% of total healthcare costs. The financial incentives inuring to the benefit of doctors in ordering more tests and performing more procedures was a better explanation for many medical practices that tort reform advocates have called defensive medicine. The principal type of defensive medicine is diagnostic testing, yet those costs have been decreasing and they are a small proportion of overall healthcare costs. Thus, defensive medicine cannot be driving the increase in healthcare costs.

This study shows that going to a national single-payer health plan would save an estimated $592 billion annually in healthcare costs. This savings results from slashing administrative waste associated with the private insurance industry ($476 billion) and reducing pharmaceutical prices to European levels ($116 billion). These savings would be enough to cover all 44 million uninsured and upgrade benefits for everyone else.

This news article examines doctor pay in the U.S. (the highest in the world, even after adjusting for how rich each country is) and argues that in order to meaningful cut healthcare costs, doctors should be paid less.

U.S. Dept. of Health and Human Services, Office of Inspector General. Levinson DR. Hospital incident reporting systems do not capture most patient harm. Jan.2012. Rpt No.: OEI-06-09-00091. Office of Inspector General website (last known to be available at <https://oig.hhs.gov/oei/reports/oei-06-09-00091.pdf>).

This study finds that on average, hospital staff report only 14% of cases of harm to patients caused by medical care in hospitals, even though regulations require that all such cases be reported. (Id. at 10, 12-13.) Only 11% of permanent disability or death caused by medical care is reported. (Id. at 12.)

This news article reports that medical errors kill more than a quarter of a million people every year in the United States and injure millions. The article lists 10 “shocking” medical mistakes by doctors and nurses, including treating the wrong patient, leaving surgical sponges or other tools inside the patient after surgery, causing air bubbles in the blood, operating on the wrong body part, hospital-caused infections, confusing the tubes going into a patient and putting the wrong medication in the wrong tube, and others.

We highly recommend this book. As adapted from Amazon.com book reviews of this book: Marty Makary, M.D., M.P.H., is a surgeon at Johns Hopkins Hospital and a professor of Health Policy at the Johns Hopkins School of Public Health. He is a regular medical commentator for CNN and FOX News and appears weekly on a wide variety of programs to discuss health topics. He is a leading patient-safety researcher and has led the World Health Organization efforts to develop ways to measure healthcare quality. He tweets @DrMartyMD. Here are some startling statistics Dr. Makary gives: One in four hospital patients is hurt by a medical mistake. Thirty to forty percent of our healthcare dollars pays for fraudulent or unnecessary care. Ten to fifteen percent of patients are not given all their options regarding their care. Possibly the most startling statistic of all: surgeons operate on the wrong body part 40 times per week.The book begins with the true story of Dr. “X,” a renowned surgeon at Harvard who is worshiped by his patients, but who is known by all the residents to be the most dangerous doctor on staff. Dr. Makary paints a picture of a medical system that is viewed to be a well-oiled machine functioning for the public benefit, but which in actuality is more like “The Wild West,” largely centered on profit and rampant with medical mistakes by poorly policed physicians, whose mistakes are largely kept secret from the public. Dr. Makary argues that transparency is the key to revolutionizing health care in the U.S. Doctors and hospital administrators need to stop their ever-present culture of secrecy. They need to begin in earnest policing doctors who malpractice repeatedly, rather than turn a blind eye. Almost every hospital keeps a wealth of data regarding patient outcomes and complications for the various procedures performed at that hospital (adjusted for case complexity). These data show that some hospitals have very good results for certain procedures and some very poor. However, the hospitals by and large refuse to make this information available to the public. Making this information publicly available would force the poor performing hospitals to improve or risk losing business and profits. When the New York Health Commissioner required New York hospitals to make available to the public each hospital’s death rate from heart bypass operations, patient care greatly improved and the death rate decreased dramatically, as the poorer performing hospitals scrambled to improve their care. As it is, hospitals have little to no financial or other incentive to improve these “danger zones” and actually make more money when they charge patients for the follow-up medical care that their original poor care necessitated. Dr. Makary concludes his book with 5 concrete steps that he argues would greatly improve the quality of medical care in America, as well as save countless billions of dollars currently wasted on fraudulent and unnecessary care.

This study finds that patient harm caused by medical care occurred in 33.2% of hospital admissions. (Id. at 584.) “The true rates [of patient harm] are likely to be higher still, given [that] not all adverse events are documented in the patient record.” (Id. at 586.)

This study looks at adverse medical events (defined as medical interventions that cause harm or injury to a patient separate from the underlying medical condition) and the overall cost to society of these adverse events (that is, economic costs associated with the lives lost or injuries suffered from the medical care). From the abstract:

Adverse medical events … are unfortunately an all-too-frequent occurrence in US hospitals. They may cause as many as 187,000 deaths in hospitals each year, and 6.1 million injuries, both in and out of hospitals. We estimate the annual social cost of these adverse medical events … ranges from $393 billion to $958 billion, amounts equivalent to 18 percent and 45 percent of total US health care spending in 2006….

This is another book that we highly recommend. As adapted from Amazon.com book reviews of this book: The author is Dr. Otis Brawley, the chief medical and scientific officer of The American Cancer Society. He is an oncologist with stellar clinical, research, and policy credentials. How We Do Harm exposes the underbelly of healthcare today—the overtreatment of the rich, the under-treatment of the poor, the financial conflicts of interest that determine the care that physicians’ provide, insurance companies that don’t demand the best (or even the least expensive) care, and pharmaceutical companies concerned with selling drugs, regardless of whether they improve health or do harm. How We Do Harm pulls back the curtain on how medicine is really practiced in America. Brawley tells of doctors who select treatment based on payment they will receive, rather than on demonstrated scientific results; hospitals and pharmaceutical companies that seek out patients to treat even if they are not actually ill (but as long as their insurance will pay); a public primed to swallow the latest pill, no matter the cost; and rising healthcare costs for unnecessary—and often unproven—treatments that we all pay for. Brawley calls for rational healthcare, healthcare drawn from results-based, scientifically justifiable treatments, and not just the peddling of hot new drugs.

In 2009, CEO compensation at the 25 largest independent children’s hospitals ranged from a high of nearly $6 million to a low of $686,125. Overall, 22 of 25 children’s hospital CEOs collected at least $1 million, three received at least $2 million, and 2 received more than $5 million.

This study examined the rates of patient harm from medical error to see if there had been any improvement since the 1999 IOM Report. The study showed that “harm resulting from medical care was common, with little evidence that the rate of harm had decreased substantially over a 6-year period ending in December 2007.” (ld. at 2130.) The study showed that that 25.1% of the patients receiving medical care in the hospitals surveyed suffered from medically induced harm. (Id. at 2124-2125.) Moreover, 63.1% of these were preventable. (ld. at 2127.)

U.S. Dept. of Health and Human Services, Office of Inspector General. Adverse events in hospitals: National incidence among Medicare beneficiaries. Nov.2010. Rpt No.: OEI-06-09-00090 (last known to be available at <http://psnet.ahrq.gov/resource.aspx?resourceID=19811>).

In this study, medical records of Medicare patients were screened using the Global Trigger Tool combined with POA (“present on admission”) indicator codes for initial screening. Of hospitalized Medicare patients, 13.1% suffered serious harm as a result of medical care, including 1.5% who died as a result of medical care (which equemates to 15,000 deaths from medical care in a single month). (Id. at i-ii, 15-26.) An additional 13.5% suffered temporary harm as a result of medical care. (Id.) Of the above numbers, 44% were preventable. These preventable cases of medical harm were most commonly linked to medical errors, substandard treatment, and/or inadequate patient monitoring or assessment, although other types of medical errors also played a role. (Id. at ii, 22-25.) This means that 13.7% of patients suffered from serious or temporary medical harm caused by preventable medical error. (Id. at 24.)

Academy of Managed Care Pharmacy. The Academy of Managed Care Pharmacy’s Concepts in Managed Care Pharmacy – Medication Errors. 2010 (last known to be available at <http://www.amcp.org/Sec.aspx?id=5399>).

This statement paper by the Academy of Managed Care Pharmacy reports that the number of patient deaths resulting from drug errors increased from 198,000 (in 1995) to 218,000 (in 2000). The costs to the U.S. economy of these medical misadventures was more than $177 billion per year. (Id. at 2, citing Wendel E. Pharmacists survey gives insight into the impact of the economic downturn on patients, pharmacy practice, and their communities. J of the American Pharmacists Assn. Mar.2009.)

This study looks at various methods of screening medical records for medical error. It finds that for initial screening purposes, nurse medical record review using the Institute for Healthcare Improvement Global Trigger Tool is the best single initial screening tool for identifying occurrences ultimately determined by physicians to be adverse or temporary harm events, and POA indicator codes (coding for medical conditions that are present on admission) is the second best. Only 7% of occurrences determined by physicians to be adverse events (including some of the most serious events involving death or permanent disability to the patients) actually get reported in hospital incident reports. That is to say, hospitals reported only very few instances of medical error. “[This] suggest[s] a disconnect between the hospitals’ purpose for internal incident-reporting systems and the goal of identifying events that result in patient harm….” (Id. at ii, 11, 15, 27.)

U.S. Dept. of Health and Human Services, Office of Inspector General. Adverse Events in Hospitals: Case Study of Incidence Among Medicare Beneficiaries in Two Counties. Dec.2008. Rpt No.: OEI-06-08-00220 (last known to be available at <http://oig.hhs.gov/oei/reports/OEI-06-08-00220.pdf>).

This study finds that about 15% of hospitalized Medicare patients experienced serious harm caused by medical care during their hospital stays. (Id. at i-ii, 10.) Another 15% experience less serious harm caused by medical care, which harm is temporary but nonetheless requires additional medical intervention. (Id. at i-ii, 16.)

This study finds that for hospital patients, the number of cases of serious, preventable medical harm that is not documented in the patients’ records (and can only be discovered through patient interviews) is twice the number of cases of serious, preventable medical harm that can be discovered by reviewing patient medical records. In other words, many cases of serious, preventable medical harm are not ever recorded in the medical records and can be discovered only by interviewing the patients.

This report to Congress shows that in 2004, the U.S. spent twice as much per person on healthcare when compared to the average of the other 30 economically advanced democracies in the world (even after adjusting for how rich each country is). (Id. at CRS-2 to CRS-3.) No other country pays its doctors as much (even after adjusting for how rich each country is). General practitioners in the U.S. are paid double the median of the other advanced economies, and specialists are paid almost 3 times the median. (Id. at CRS-18.) The U.S. pays the highest prices in the world for medical equipment. (Id. at CRS-19.) The U.S. pays higher prices than any other country for medical procedures. (Id. at CRS-22.) It pays higher prices for pharmaceuticals than most of the world. (Id. at CRS-22.) Spending on health administration and insurance in the U.S is 7 times that of the other countries’ median expenditure. (Id. at CRS-29.) Studies suggest that “doctors’ financial stakes in specialty hospitals cause them to refer more patients for elective surgery – especially relatively healthy patients.” (Id. at CRS-40.) Despite claims that U.S. doctors are more likely to practice “defensive medicine” (that is, ordering more tests or providing more care than they otherwise would in an attempt to avoid being sued for medical malpractice), analysis by the U.S. Congressional Budget Office (“CBO”) found no effect of malpractice tort reform on health spending. (Id. at CRS-42, citing Beider P, Hagen S. Limiting Tort Liability for Medical Malpractice. Congressional Budget Office. Jan.2004).) The CBO concluded that, “On the basis of existing studies and its own research, CBO believes that savings from reducing defensive medicine would be very small.” (Id. at CRS-42.) A more recent CBO analysis found that studies on the relationship between tort reforms and healthcare spending are “inconsistent” and “mixed.” The CBO concluded that tort reforms are sometimes associated with higher health spending, sometimes lower spending, and sometimes no effect on health spending. (Id., citing White C, Hagen S. Medical Malpractice Tort Limits and Health Care Spending. Background Paper, Congressional Budget Office. Apr. 2006.) A 6-country comparison of advanced economies found that the U.S. had the worst rating in terms of medical errors. (Id. at CRS-45, citing Davis K, Schoen C, Schoenbaum S, et al.Mirror, mirror on the wall: An international update on the comparative performance of American Health Care. The Commonwealth Fund. 2007;59 (last known to be available at <http://www.commonwealthfund.org/Publications/Fund-Reports/2007/May/Mirror–Mirror-on-the-Wall–An-International-Update-on-the-Comparative-Performance-of-American-Healt.aspx>).)

This report investigated claims that the medical malpractice system was out of control and that frivolous lawsuits were being rewarded with huge payouts. It looked at the then most recently publicly available data from the federal government’s National Practitioner Data Bank (“NPDB”), which contains data on malpractice payments made on behalf of doctors as well as information about disciplinary actions against them by state medical boards or hospitals. The report found that the claims of a medical malpractice crisis are largely false and that the real crisis is in patient safety. Although President Bush claimed in 2006 that “lawsuits are driving many good doctors out of practice,” statistics published by the American Medical Association (“AMA”) show that the number of practicing physicians is growing faster than the population. (Id. at 1.) President Bush claimed that medical malpractice lawsuits send physicians’ malpractice insurance premiums “skyrocketing,” but recent news reports reveal that medical malpractice insurers are making huge profits. (Id.) In Florida, one of the AMA’s “crisis” states, the Office of Insurance Regulation reported that the 15 largest medical malpractice insurers saw profits of $803 million in 2005. “It is clear that this call for limits on the ability of injured patients to seek redress in court is just one piece of a larger effort by the business lobby to protect businesses from being held accountable when they recklessly or negligently hurt people.” (Id.)

Overall, the data show that President Bush is misdiagnosing the health care problem. The court-based compensation system is, on the whole, a rational one that provides money for valid claims and dismisses invalid ones. These findings are confirmed by other research, including a recent study conducted by researchers from the Harvard School of Public Health in which the authors found that “portraits of a malpractice system that is stricken with frivolous litigation are overblown,” going on to note that “the malpractice system performs reasonably well in its function of separating claims without merit from those with merit and compensation the latter.” [Fn. omitted.]

(Id. at 1.)

The report also found that state medical boards largely fail to discipline repeat-offender doctors. Only 15% of doctors who made four or more malpractice payments were disciplined, and only 33% of doctors who made 10 or more malpractice payments were disciplined, meaning that two-thirds of doctors in this group of egregious repeat offenders were not disciplined at all. (Id. at 13.)

We highly recommend this book. As adapted from Amazon.com book reviews of this book: This excellent book is about the current state of the U.S. medical system and some glaring shortcomings in patient care. The book was written by a medical scientist whose college-age athlete son died from a highly treatable heart ailment, missed by a team of cardiologists. As the father pieces together the tragic events that led to the death of his son, the story opens into a broad-ranging examination of our healthcare system, and how that profit-driven system disserves patients. It also shows how the state medical boards and other health-care accountability systems are ineffective. The lack of any effective system to ensure ongoing physician competence is discussed and contrasted with the effective ongoing training systems in place to ensure continual pilot competence. Proposals are made for improving patient care.

This is another book that we highly recommend. The author is Shannon Brownlee, the current senior vice president of the Lown Institute (a nonprofit organization whose goal is to reform the U.S. healthcare system). She is also a former acting director of the Health Policy Program and a noted essayist, writer, and speaker who has published in The New York Times Sunday Magazine, Time, The Atlantic, and the Washington Post. Following is a summary of some highlights of the book. The American healthcare system is dysfunctional and spectacularly expensive. We spend almost 20% of our gross domestic product on healthcare. Per person, we spend about 2.5 times the amount spent per person by the rest of the industrialized world. Although politicians constantly tell us that we have the best healthcare system in the world, that simply is not the case. By every measure, the health of Americans lags behind the health of citizens of other advanced economies. The conventional wisdom says that our healthcare is so expensive because we don’t ration care. But that accounts for just 3% of the costs of U.S. healthcare. Part of the reason that our healthcare is so expensive is that administrative costs take up a much bigger part of our healthcare budget than in other advanced economies, each year wasting about $160 billion plus another $30 billion in after-tax profits earned by health insurance companies. Another reason is that America pays its doctors much more than other countries (even after adjusting for how rich the country is). Americans also pay much more for hospital services and drug costs. However, the single biggest reason why American health care is so expensive is because we spend 20-33% ($500-$700 billion) on unnecessary medical care, care that does nothing to improve our health and that is, in essence, overtreatment. This not only hurts our pocketbooks, it makes our health worse than it should be – “Unnecessary treatment and tests aren’t just expensive; they also can harm patients.” Unnecessary medical care also makes medical errors more likely, because the more care you receive, the higher the odds that some doctor or nurse or tech will make a mistake. There are many reasons why doctors and hospitals deliver unnecessary care. The biggest reason, though, is that most doctors and hospitals “are paid for how much care they deliver, not how well they care for their patients. They get paid more for doing more.” That perverse and harmful incentive needs to be changed.

This U.S. Institute of Medicine report finds that preventable medication errors harm at least 1.5 million people in the United States every year. The extra medical costs of treating drug-related injuries occurring in hospitals alone conservatively amount to $3.5 billion a year, and this estimate does not take into account lost wages and productivity or additional healthcare costs. Studies indicate that 400,000 preventable drug-related injuries occur each year in hospitals. Another 800,000 occur in long-term care settings, and roughly 530,000 occur just among Medicare recipients in outpatient clinics. And, the IOM Committee notes that these numbers likely underestimate the true numbers.

This study shows that juries are biased in favor of physician defendants, whereas judges generally are not. By way of comment, this explains why defendant doctors and hospitals almost always insist on a jury – they know that with a jury, the deck is stacked in their favor. This fact is contrary to the propaganda of the doctors, hospitals, and insurance companies that juries favor plaintiffs and hand out millions of dollars willy-nilly.

This article was written by probably the most respected physician advocate for improving patient care, Dr. Lucian Leape of Harvard, and a colleague. The authors note that physician performance failures “are not rare and pose substantial threats to patient welfare and safety.” However, systems to identify problem physicians are ineffective, and most physicians are loathe to confront or report a colleague whom they perceive as having a problem. Doctors “abhor” making judgments about colleagues who may also be friends or practice partners. The hospital may need the physician’s revenue stream. Disciplinary actions by state medical boards can be met with counter-lawsuits by the physicians. There are few national or state standards of conduct or competence, or measures for monitoring physician performance. This contrasts markedly to that of other professionals whose conduct affects the public welfare. Commercial pilots, for example, must pass both physical and performance examinations every year.

In this study, trained physicians reviewed 1,452 closed malpractice claims from five liability insurers to determine whether a medical injury had occurred and, if so, whether it was due to medical error. The study found that 97% of the medical malpractice lawsuits showed harm caused by medical treatment. Sixty-three percent were caused by medical error, but only 56% received compensation. For most of the claims where there were no errors or medical injuries, there was no compensation. The study concluded that (1) “portraits of a malpractice system that is stricken with frivolous litigation are overblown”; (2) “the malpractice system performs reasonable well in its function of separating claims without merit from those with merit and compensating the latter”; (3) it is “troubling” that of the claims involving medical error, 17% of them received no payment; (4) “failure to pay claims involving error adds to a larger phenomenon of underpayment generated by the vast number of negligent injuries that never surface as claims.” (Id. at 2031.)

The U.S. Congressional Budget Office (“CBO”) investigated the effect of tort reforms and healthcare costs and found that the relationship between tort reforms and healthcare spending are “inconsistent” and “mixed.” (Id. at 1.) The CBO concluded that tort reforms are sometimes associated with higher health spending, sometimes lower spending, and sometimes no effect on health spending, and, “The estimated effect of implementing a package of … proposed tort limits is near zero.” (Id. at 3.)

This highly informative book, which we strongly recommend, is by a Professor of Law and Health Sciences at the University of Pennsylvania who also has served as a consultant to insurance companies. The author investigates the allegations that frivolous medical malpractice lawsuits have caused malpractice premiums to skyrocket, doctors to leave the practice of medicine, juries to award excessive amounts to plaintiffs who have been egged on by greedy lawyers, and billions of dollars to be wasted on defensive medicine. He calls this the “Medical Malpractice Myth” and finds it to be basically false:

Built on a foundation of urban legend mixed with the occasional true story, supported by selective references to academic studies, and repeated so often that even the mythmakers forget the exaggeration, half truth, and outright misinformation employed in the service of their greater good, the medical malpractice myth has filled doctors, patients, legislators, and voters with the kind of fear that short circuits critical thinking.

The author painstakingly shows that research by the medical industry itself establishes that the real problem is too much medical malpractice, not too much litigation. And despite the rhetoric of too many lawsuits, most malpractice victims do not sue. This means that the malpractice victims, and not doctors, hospitals, or insurance companies, bear most of the costs of medical malpractice. Those same studies by the medical industry show that the real costs of medical malpractice are the lost lives, extra medical expenses, time out of work, and pain and suffering of hundreds of thousands of people each year. Some key findings, which the author backs up with exhaustive published research on the various topics, are:

Preventable medical mistake is one of the leading causes of death in the U.S.

There are between 7 and 25 serious medical malpractice injuries for every one medical malpractice lawsuit filed.

The number of medical malpractice lawsuits has remained stable when adjusted for population growth.

The size of medical malpractice jury verdicts has remained stable when adjusted for healthcare cost growth (an important component of damages in a medical malpractice lawsuit).

The cost for medical malpractice insurance, medical malpractice lawsuits, and the associated expenses is somewhere between 1 and 2 percent of total healthcare expenses, and so is not an important factor in the high cost of health care.

There is little proof of so-called “defensive medicine.”

It is the insurance industry “underwriting cycle,” and not malpractice lawsuit payouts, that cause insurance company profits malpractice insurance premiums to rise and fall.

Medical liability insurance “crises” are not caused by sudden or dramatic increases in malpractice settlements or jury verdicts. Rather, they are caused by the insurance industry systematically under-reserving in the years leading up to the “crisis,” accompanied by “herding” behavior among insurance companies competing to sell insurance.

The legal system does a good job of weeding out weak malpractice claims. Weak claims are usually brought because the patient has been unable to obtain information or answers from his or her healthcare provider. If information obtained during a lawsuit shows that the medical actually was good, the lawsuit usually is dropped by the patient.

For medical malpractice cases that actually go to trial, defendants are more likely to win than plaintiffs.

When plaintiffs do win, juries follow the jury instructions and award damages based on the actual injuries to plaintiff, not on the “deep pockets” of the doctors and hospitals and their insurance companies.

Doctors and hospitals and their insurance companies put up a strong fight even in cases where they know that the plaintiff should win, and they rarely pay anything if they think that the doctor did nothing wrong.

Insurance claims files show that insurance companies only very rarely pay weak claims, and when they do, the amount paid is only a small fraction of the claimed damages.

Medical malpractice lawsuits increase knowledge about the extent of medical mistakes and injuries, with the beneficial result of stimulating more studies on medical injuries and efforts to curb medical injuries.

Medical malpractice lawsuits improve patient safety by motivating healthcare providers to improve their safety practices to avoid lawsuits and to reduce their insurance premiums. As an example, the American Society of Anesthesiologists (“ASA”), tired of the high malpractice rates and accompanying high malpractice insurance premiums, attempted to gather every malpractice claim ever filed in connection with anesthesia. They then analyzed those claims and found that over one-third of the claims came from “adverse respiratory events” that were preventable. Rather than hide from that information, the ASA supported the development of better anesthesia equipment and new practice guidelines. As a result, anesthesia safety dramatically improved and anesthesia malpractice lawsuits and insurance premiums dramatically fell.

Medical malpractice lawsuits help injured patients by providing them compensation that they need and deserve.

Medical malpractice lawsuits promote traditional American values like justice and responsibility. They are the only way that powerful medical interests can be held accountable for their wrongs.

There is no evidence that the threat of medical malpractice lawsuits discourages the disclosure of errors. The available evidence supports the opposite conclusion.

Malpractice lawsuits probably do to some extent cause doctors to practice “defensive medicine.” However, there is no way to distinguish between “good” defensive medicine caused by malpractice lawsuits (which helps prevent injuries) and “bad” defensive medicine (that does not help prevent injuries but instead merely wastes money). In the few research studies where “bad,” money-wasting effects of defensive medicine have been found, its effects on healthcare costs are very small and have been negated by the increased cost-consciousness of the managed care movement.

So-called “tort reform” (that is, limiting the compensation of victims of medical errors) has no effect on healthcare costs. The Congressional Budget Office (in line with other research) has “found no effect of tort controls on medical spending,” and has concluded that there would be no cost savings from a reduction in defensive medicine.

Doctors generally do not retire or leave a state because of malpractice lawsuits. As in any other walk of life, they do so for personal reasons. There is no good evidence that malpractice lawsuits have affected any patient’s access to care. Shortage of doctors, where they exist, come from rapid population growth in some parts of the country, a lack of health insurance and other problems that disproportionately affect rural areas and the poor, and from long-standing efforts by policy-makers to restrict the supply of doctors.

Research suggests that tort reform does not improve health-care outcomes. If anything, the research suggests that some kinds of tort reforms might have a detrimental effect on health-care outcomes, because it limits the injury-prevention effect of malpractice lawsuits.

This report is based on the U.S. Department of Health and Human Services National Practitioner Data Bank (NPDB) and shows that the medical malpractice system is working well. Adjusted for population growth, the number of medical malpractice claims has fallen by 9.2% since 1991. (Id. at 2.) The total inflation-adjusted value of payouts has been flat since 1991. (Id. at 3.) The inflation-adjusted number of payments over $1 million has declined 56% since 1991; only 1% of payouts exceed $1 million (inflation-adjusted base year 1991). (Id. at 5.) The medical liability system is not one of “jackpot” justice in which patients go to court and score big awards based on flimsy claims. (Id. at 1.) Instead, the evidence shows that the system is working as designed: those with minor injuries receive little compensation, while the great bulk of malpractice awards are for cases involving major, debilitating injuries or death. The amount of malpractice payments generally matches the degree of harm. (Id. at 6.) Most kinds of common, preventable medical errors have increased over time. (Id. at 8.) Five and one-half percent of doctors are responsible for 57.3% of medical malpractice payouts. (Id. at 9.) Doctors with repeated malpractice payouts suffer few consequences. (Id. at 10.) Only 8.3% of doctors with 2 or more medical malpractice payouts have been disciplined by their state medical board. Only 17.8% of doctors with 5 or more medical malpractice payouts have been disciplined, and only 32.5% of doctors with 10 or more medical malpractice payouts have been disciplined. (Id. at 10.) One physician with 30 malpractice payouts was not disciplined by the state medical board, another with 21 payouts was not disciplined, and so forth. (Id. at 11-12.)

This news article in USA Today shows that there is a shortage of doctors in America that will only get worse in the coming years, unless something is done about it. The shortage is because, “For the past quarter-century, the American Medical Association and other industry groups have predicted a glut of doctors and worked to limit the number of new physicians.” Yet, “It didn’t happen…. Physicians aren’t driving taxis. In fact, [they] are all gainfully employed, earning good incomes, and new physicians are getting two, three or four job offers.” (Internal quotes omitted.) In America, “The marketplace doesn’t determine how many doctors the nation has, as it does for engineers, pilots and other professions. The number of doctors is a political decision, heavily influenced by doctors themselves.” The doctors and other industry groups influence Congress, which in turn restricts the supply of new doctors.

The U.S. Congressional Budget Office evaluated the effect of tort reform on “defensive medicine” and overall healthcare costs. It noted that restrictions on malpractice liability “modify the distributions of gains and losses to individuals and groups but do not create benefits … for society as a whole.” (Id. at 5.) In other words, “tort reform” and other restrictions on malpractice suits make doctors, hospitals, and insurance companies richer, at the expense of malpractice victims who are denied full recovery (or at times any recovery at all), without reducing the cost of healthcare. The Congressional Budget Office also found that:

Proponents of limiting malpractice liability have argued that much greater savings in health care costs would be possible through reductions in the practice of defensive medicine. However, some so-called defensive medicine may be motivated less by liability concerns than by the income it generates for physicians or by the positive (albeit small) benefits to patients. On the basis of existing studies and its own research, CBO believes that savings from reducing medicine would be very small.

(Id. at 6; emphasis added.) In other words, the extra tests and procedures that doctors order are more a result of their wanting to make more money than a result of their concerns about malpractice liability, and in any event, savings from reducing defensive medicine would be “very small.”

This study researched forty years of civil jury verdicts and found that:

Our results are striking. Not only do we show that real average awards have grown by less than real income over the 40 years in our sample, we also find that essentially all of this growth can be explained by changes in observable case characteristics and claimed economic losses (particularly claimed medical costs)…. Rising claimed medical costs appear to be one of the most important factors driving increases in jury verdicts.

In other words, there are no “skyrocketing” jury verdicts. The verdicts size has increased less than increases in real income, and those modest increases are caused by the increased medical costs rightfully being reflected in the jury verdicts.

This article in The Washington Monthly shows the falsity of claims by doctors in West Virginia that frivolous lawsuits are forcing up insurance premiums and causing doctors to leave the practice of medicine. It shows that many of the doctors making these claims themselves are former drug addicts, felons, doctors whose licenses have been revoked, and doctors who get sued far more than most of their colleagues, often on meritorious malpractice lawsuits. The article notes that the U.S. Government Accountability Office (“GAO”) has found little evidence to back the doctors’ claims that lawsuits are forcing many of them to abandon the practice of medicine or to avoid high-risk procedures. Insurance executives themselves have admitted that imposing caps on medical malpractice lawsuits does not bring insurance premiums down. The only way to bring insurance premiums down is to have state medical boards revoke the licenses of the relatively small percentage of doctors who cause a disproportionately large number of malpractice claims. But the state medical boards – which are run by doctors – have been notoriously reluctant to police their own.

This article in the Journal of the American Medical Association examines the U.S. healthcare system in comparison to the rest of the world. Although the U.S. healthcare system is by far the most expensive in the world, both on a total expenditure basis and on a per-capita basis, the article finds that the U.S. system is nowhere near the best. Some excerpts from the article:

Information concerning the deficiencies of US medical care has been accumulating….

The fact is that the US population does not have anywhere near the best health in the world. Of 13 countries in a recent comparison, the United States ranks an average of 12th (second from bottom) for 16 available health indicators. Countries in order of their average ranking on the health indicators (with the first being the best) are Japan, Sweden, Canada, France, Australia, Spain, Finland, the Netherlands, the United Kingdom, Denmark, Belgium, the United States, and Germany. Rankings of the United States on the separate indicators are:

13th (last) for low-birth-weight percentages

13th for neonatal mortality and infant mortality overall

11th for post-neonatal mortality

13th for years of potential life lost (excluding external causes)

11th for life expectancy, at 1 year for females, 12th for males

10th for life expectancy, at 15 years for females, 12th for males

10th for life expectancy, at 40 years for females, 9th for males

7th for life expectancy, at 65 years for females, 7th for males

3rd for life expectancy, at 80 years for females, 3rd for males

10th for age-adjusted mortality

The poor performance of the United States was recently confirmed by the World Health Organization, which used different indicators. Using data on disability-adjusted life expectancy, child survival to age 5 years, experiences with the health care system, disparities across social groups in experiences with the health care system, and equality of family out-of-pocket expenditures for health care (regardless of need for services), this report ranked the United States 15th among 25 industrialized nations.

(Id. at 483; footnotes omitted.)

World Health Organization. The World Health Report 2000. Health Systems: Improving Performance (last known to be available at <http://www.who.int/whr/2000/en/>).

Although the U.S. has by far the highest health expenditures per person, the U.S. healthcare system was ranked only 37th in the world overall when evaluated on a number of factors. (Id. at 155.)

IOM Quality of Health Care in America Committee. The Institute of Medicine Report on Medical Errors: Misunderstanding Can Do Harm. Medscape General Medicine. 2000;2(3) (last known to be available at <http://www.medscape.com/viewarticle/418841>).

This article by the IOM is a follow-up to its 1999 Report. It notes that the annual number of deaths in hospitals as stated in its 1999 IOM Report (44,000-98,000) likely underestimates the true toll from medical errors:

Unfortunately, the IOM numbers [of 44,000-98,000 deaths annually], shocking as they are, probably underestimate the extent of preventable medical injury, for 2 important reasons. First, they are based on data extracted from medical records. Many injuries, and most errors, are not recorded in the medical record, either by intent or by inattention, or, more likely, because they are not recognized. [Fns. omitted.]

The second reason the IOM estimates are probably low is that they exclude outpatient injuries. We know very little about the extent of AEs [adverse events] in ambulatory care, but there is no evidence the error rate is less. In fact, absent hospital safeguards, regulation, and peer supervision it might well be higher. A recent study reported that 10% of office prescriptions had significant errors. [Fn. omitted.] Recent reports of deaths of inpatients undergoing a supposedly routine procedure, liposuction, are not reassuring. [Fn. omitted.] None of these injuries or deaths are included in the IOM estimates. In 1996, 31.5 million ambulatory surgeries and procedures were performed. [Fn. omitted.] Even if only one half of 1% of these patients experienced a preventable AE (one fifth the inpatient rate), that alone would impact over 100,000 individuals.

The limitations of population-based studies become evident when in-depth studies “drill down” into specific clinical areas. Almost invariably, error and injury rates are found to be much higher.

This 1999 IOM Report concluded that 44,000-98,000 Americans die each year in hospitals due to medical errors. (See IOM Report, at pp. 1, 31.) These figures placed death caused by medical errors in hospitals ahead of deaths caused by motor-vehicle accidents, breast cancer, and AIDS. (Id. at 1.) As eye-opening as these numbers were, the IOM Report also noted that its figures did not include outpatient care, and if outpatient care were included, the true number of deaths in America from medical errors would be even higher. (Id. at 2.)

This study evaluated the quality of medical care in the U.S. and found that for acute care, an average of 30% of patients received contraindicated care (that is, medical care that should not have been given). For chronic conditions, 20% of patients received contraindicated care. (Id. at 884.) The study concluded that:

The quality of health care in the United States varies among hospitals, cities, and states. Whether the care is preventive, acute, or chronic, it frequently does not meet professional standards. We can do much better. The solution is not simply a matter of spending more money on health care. A large part of our quality problem is the amount of inappropriate care provided in this country. Elimination of such non-beneficial and potentially harmful care would lead to a large savings in human and financial resources.

This study looked at approximately 31,000 hospital discharges in New York. The study found that medical management caused injury in 3.7% of hospitalizations, and medical negligence caused injury in 1% of hospitalizations. “There is a substantial amount of injury to patients from medical management, and many injuries are the result of substandard care.” The study required that two doctors working independently have found negligence in order for it to be counted as negligence, so the methodology was quite conservative.

This study looked at 31,429 patient charts at New York hospitals. The study found that of all the cases of patient harm caused by medical malpractice, only 1.53% resulted in a malpractice lawsuit (or about 1 lawsuit per 65 cases of harm from medical malpractice). (Id. at 245, 247-49.) A finding that the ratio of adverse events caused by negligence to malpractice claims is 1 to 7.6 “overstates the chances that a negligent adverse event will produce a claim.” (Id. at 245.)

The relative frequency 7.6 to 1 does not mean, as is commonly assumed, that 13 to 14 percent of injuries due to negligence lead to claims…. [T]he fraction of medical negligence that leads to claims is probably under 2 percent. The difference is accounted for by injuries not caused by negligence, as defined by our protocol, that give rise to claims.

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